Netflix announced that its revenue growth has “slowed down significantly” as 200,000 global subscribers unsubscribe from the service. The streaming giant, which now has 221.6 million subscribers, last reported losing customers in October 2011.
Netflix lost its first subscriber
In more than a decade, sending its stock down 25% in extended trading amid concerns that the pioneering streaming service may have seen good days. its best. The company’s customer base fell by 200,000 subscribers in the January-March period, according to its quarterly earnings report released on Tuesday.
This is the first time Netflix subscribers have dropped since the streaming service became available in most of the world. This year’s drop is partly due to Netflix’s decision to withdraw from Russia in protest of the Ukraine war, which resulted in the loss of 700,000 subscribers.
Here’s one way to see how important that is:
During his company’s earnings call following the release of its results, co-CEO Reed Hastings said the company would eventually add a translated version. The service is funded by ads, which will be cheaper than the current version without ads. . Hastings has insisted for years that they doesn’t need to sell ads, and it’s a better service because it doesn’t.
They says competition with YouTube, Amazon, etc has been going strong for 15 years. But as traditional entertainment companies realized that streaming was the future, new streaming services emerged.
They already made harsh forecasts in the spring quarter, despite the resurgence of long-awaited shows such as Stranger Things and Ozark, and the debut of the movie The Gray Man starring Chris Evans and Ryan Gosling. Predicted to lose 2 million subscribers. Wall Street was targeting 227 million in the second quarter, according to Refinitiv data.
“Our earnings growth has slowed significantly,” they said in a letter to shareholders on Tuesday. “As we expected, streaming is growing linearly and Netflix titles are very popular all over the world, but relatively high given the large number of households with accounts. Household penetration and competition combine to create headwinds for earnings growth. “
They also said that it lost 600,000 customers in the United States and Canada this quarter. However, data for Indian customers and other customers are not disclosed in the report.
Why Netflix is losing its users ?
They are also blaming the Russia-Ukraine war situation as they have to suspend their services over there because of the invasion, which results in losing the subscribers. It is also one of the reasons for the loss. They are also losing users because of the changes in the pricing policy too.
There was a time when users always chooses Netflix for promising content shows, movies and web series but now there are several new OTT platforms who has good quality content which is giving a tough competition to them.
Hollywood was willing to offer a lot of old TV shows and movies, as many didn’t expect to pay to stream them over the Internet. Now major movie and television companies have realized they are wrong. So they got back a lot of what was on Netflix and put it in their own service. For example, Friends is on HBO Max. The office is in Peacock. Everything from Disney is in Disney +. And most importantly, they are competing with Netflix for new projects. That’s why it has seen a lot of valuable content disappear, but at the same time it’s getting harder to find great new projects.
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